I always have mixed feeling when I read Martin Hutchinson. He is neither a starry eyed free marketer nor a bleeding heart liberal. Rather, he is a conservative in the original sense of the word. He does not like change.

Thus, you can usually count on him to argue that things were better in the good old days. Were markets more regulated 50 years ago? That was better then now according Mr. Hutchinson. Was there less welfare 50 years ago? That was better then now according Mr. Hutchinson.

I don’t have the same kind of uncritical appreciation for the past that Mr. Hutchinson has. But my biggest problem with him is his apparent belief that we can just change the laws back to what they use to be and society will follow meekly along back to the good old days. In reality though, culture changes law, law does not change culture.

All that is just to say that I fully support the central point of Mr. Hutchinson rant against Fannie Mae and Freddie Mac. But I have to disagree with his assertion that the modern day financial elites are just rent seekers who add no value.

Value is in the eye of the beholder. In the good old days, a community would save enough for its own mortgage needs through local financial institutions. That made capital cheaper in absolute terms. But that also required disciplinal and sacrifice on the part of the culture.

The value the current day financial elite provide is that they get the money for mortgage without anyone in this country needing to save. But for such magic to occur you need highly paid magicians. Plus, you have to make a deal with the devil.

But that is what the baby boomers wanted so no one should pretend that they are the unfortunate victims of the evil elites.